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Analyst firm Telsyte predicts that by 2021, the average Australian home will have 14 IoT devices in operation, with the country’s home IoT market expected to reach A$4.7bn (US$3.5bn) – a leap from A$377m last year.

While Australian home owners are proving to be enthusiastic IoT adopters, so are some industries.

Take Woodside, a liquefied natural gas (LNG) supplier, inherited 200,000 sensors when it took full control of the Pluto LNG plant in Western Australia. Although the sensors were not connected to the internet at first, they were collecting critical measurements.

To predict better when a problem called “foaming” was likely to occur, Woodside started a six-week trial to connect Pluto’s 10,000 sensors to the Amazon Web Services (AWS) cloud, so it could schedule any remedial action without shutting down the plant.

Since then, all 200,000 sensors at the Pluto plant have been connected, with the data being fed into 6,000 analytics models running more than three million calculations a day. If the analysts are right, this is just a drop in the ocean compared with future prospects for the technology.

Gartner has predicted that by 2020, 21 billion IoT devices will be in use worldwide, with 6% to be deployed in industrial IoT applications. Meanwhile, IDC expects that by 2020, Australia will have 2.7 million connected commercial vehicles, 1.7 million connected pets and 1.8 million connected healthcare applications. The Australian IoT market is predicted to be worth more than A$18bn.

Certainly, interest in IoT is growing rapidly. Since the IoT Alliance of Australia (IoTAA) was formed in 2016, its membership, now comprising 250 organisations and 450 individuals, has been growing by 5% a month, according to its CEO, Frank Zeichner.

Slower adoption

Although IoT deployments are accelerating and the stakes are high – the IoTAA believes the impact of IoT deployments across Australia, especially in smart cities, industrial worksites, healthcare and transportation, could reach A$120bn a year by 2025 – Zeichner says Australia is moving more slowly than the rest of the world.

To get a better handle on progress, the IoTAA is developing an index that will track the adoption of IoT deployments in key sectors such as water, electricity, smart cities, food and agriculture, and transport. The results, slated to be released in September 2017, will set a baseline against which to measure Australia’s IoT progress and maturity.

But whatever that index reveals, if Australia is to arrest its slide in the World Economic Forum’s rankings for business sophistication, innovation and technological readiness, it must speed up IoT adoption, says Zeichner.

Zeichner recently returned from Hong Kong, where the IoTAA signed a memorandum of understanding with the Smart City Consortium that will benchmark Hong Kong’s smart city progress with that of a yet-to-be-named Australian city, and he senses more urgency and activity overseas than in Australia.

But there are signs of progress. The 2016 StartUp Muster that tracks emerging Australian businesses revealed that 44.5% of startups were exploring IoT technologies, up from just 12% the year before. But for these IoT initiatives to succeed, technical issues around the lack of standards, security and communications infrastructure will have to be addressed.

Communications and security

For one, communications networks will be put under strain from the growing IoT sprawl as more businesses and consumers hook up devices to the internet. Faster broadband to the home will be required as more IoT devices are deployed, while businesses will require more reliable connectivity for IoT devices.

Today, most industrial sensors would be connected wirelessly, and access networks provided by multiple small-scale communications companies would not require high bandwidth, says Zeichner.

But those networks do not scale well and, in time, scalable IoT networks will be essential. “The reliability of that connectivity could continue to hold us back,” he warns.

Some communications companies have begun to address the challenge. In May 2017, Telstra announced the extension of its Melbourne laboratory, which will now include what it claims is Australia’s first publicly accessible GSMA Open IoT Lab.

Telstra’s chief technology officer, Hakan Eriksson, says the lab is a “game-changer for the Australian IoT ecosystem”, enabling anyone to create, test and prototype IoT technology. It also potentially delivers a stream of new clients for Telstra’s commercial IoT platform and communications services.

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The other issue to be addressed is security, with analysts warning that IoT devices are being rolled out with security almost an afterthought. This has serious implications for home IoT users, but the effect on companies deploying industrial IoT systems is more profound.

In February 2017, the IoTAA released its IoT security guidelines to provide high-level advice to CEOs and CIOs deploying or considering IoT networks, in the hope that they will take a “security by design” approach to network roll-out.

However, cyber attacks remain a clear and constant threat, with the potential to stall critical industry and infrastructure. The Stuxnet worm was the first example of malware designed to attack industrial control systems, bringing Iran’s nuclear operation to its knees in 2010.

More recent reports of Mirai and Hajime malware – which scour the internet for poorly secured IoT devices that offer a backdoor to industrial networks – have surfaced in Australia, reminding IoT users of the need for constant vigilance.

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